Employers warned to brace for 'dramatic' changes to workforce

UK employers must prepare for "dramatic" changes in the global
workforce over the next 20 years or risk mass unemployment and skills
shortages, a major report warned.

New entrants to the labour market should also be encouraged to join sectors with the most growth potential, such as pharmaceuticals, business services, healthcare and education, the report said.Photo: Alamy

By 2030, the world's population of those of working age will rise by 1bn but the majority of growth is expected to come in developing countries – such as India, Pakistan and Nigeria – as the developed world "ages", the research found.

In the UK, the proportion of people of working age in the 55 to 64 years old band will rise to 19.8pc by 2030, up from 18pc in 2010, the study forecast.

Businesses are being urged to actively maintain the UK's "competitive edge" in key industries, by investing in the future skills required against the backdrop of an older pool of workers.

New entrants to the labour market should also be encouraged to join sectors with the most growth potential, such as pharmaceuticals, business services, healthcare and education, the report said.

But both developing and developed countries face looming skills shortages, the report warned. This means a failure to invest in domestic skills now could result in the UK's most talented workers departing for emerging economies, which are searching for skilled people to help their industries grow.

The study, by recruiter Hays and research consultancy Oxford Economics, said immigration restrictions could worsen the situation and called on the G20 countries to take "co-ordinated action" to "avert future labour crises". Suggestions to tackle the issue include keeping national borders open to transfer skilled labour to the countries that need it.